Facebook's first-quarter net income fell 12%, weighed down by higher expenses despite revenues soaring, the social networking company said.
The update comes just a few weeks ahead of its expected initial public offering in May.
Facebook said in a regulatory filing that its net income fell to $205m in the three months to the end of March, from $233m a year earlier.
Net income attributable to common shareholders fell to $137m from $153m.
That amounts to earnings of nine cents per share in the latest quarter, down from 11 cents a year earlier. The company said its revenue rose 45% to $1.06 billion.
Facebook said it had 901 million monthly active users as of March 31, up from 845 million as of the end of 2011. The number of people using its mobile applications each month grew to 488 million as of the end of the quarter from 432 million as of the end of last year.
Users in Brazil, India and the US were important sources of growth both on Facebook's website and on mobile devices.
Facebook also gave details on its pending $1 billion acquisition of Instagram, the company behind a popular mobile photo-sharing application with the same name. Facebook said it is paying $300m in cash and about 23 million shares for Instagram. It also agreed to pay Instagram a $200m termination fee if the deal doesn't go through.
It confirmed it has applied to list its stock on the Nasdaq index on Wall Street under the ticker symbol "FB." Facebook could raise as much as $10 billion in the largest flotation ever by an Internet company on Wall Street.
Meanwhile, Facebook struck a $550m deal yesterday to get its hands on hundreds of AOL patents from Microsoft as the social network hardened its defences before it goes public on the Nasdaq.
Facebook will pick up around 650 of the 925 patents Microsoft bought earlier this month in an auction from AOL in a nearly $1.1 billion deal, Facebook and Microsoft said in a statement.
Facebook's general counsel called the move "another significant step in our ongoing process of building an intellectual property portfolio to protect Facebook's interests over the long term."
"Today's agreement with Facebook enables us to recoup over half of our costs while achieving our goals from the AOL auction," added Microsoft executive vice president Brad Smith.
Facebook also arranged to license the remaining 275 remaining patents or applications in the portfolio being bought by Microsoft,
